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China Business » Information » Is Chinese Competition Killing Western Small Business? Is Chinese Competition Killing Western Small Business?It is true that China is able to produce most of the smaller items that we buy every day. They have very cheap labour expenses compared to labour in the western world. That brings prices down. Because of the lower prices, their products are popular in the western world where they are the biggest sellers on the retail shelves.Reports out of China's major cities tell of lifestyles which seem to be as upscale as in any city in the western world. Well-dressed managerial types have lavish dinners in upscale restaurants, using the latest in mobile phones or laptop computers. It seems that the Chinese are nearly equal with people in the UK or USA.  Is there a probability that the Chinese will destroy small business in the west? Many western business owners have tremendous fears that their businesses will fail because of China's presence in the retail and manufacturing world. In truth, China has areas which may not be obvious, features which keep its businessmen from ruining western endeavours to make money. Firstly, look at high-end goods. Which autos are made in China which are popular among western consumers? The Chinese application of technology is weak. They depend on western manufacturers to come up with plans that they feel are worth pirating, if they are interested in pirating. The Chinese legal system is not ready to support a worldwide takeover of business enterprises. Many leaders in China have little knowledge of market economics. The red tape involved in China's manufacturing and retailing systems is consistently more confusing than any requirements in the west to open a business. Few business leaders in China have the experience to operate an international business. Chinese business leaders spend less than five percent of what western leaders spend on market research and development. Any major Chinese attempts to expand beyond China's own marketplace have failed. Of course, the negatives mentioned above will not always remain. Western businessmen cannot afford to rest on their laurels while the Chinese improve their situations. We need to do our research and come up with products, plans and services which the Chinese will not equal. Western companies with high-end products and services are selling in China. The Chinese, themselves, prefer quality products from the west over their own products. Never fear that the Chinese will force you to close your business. As long as you work to keep ahead of them, they will continue to outsource for you. Written on: 26th September 2007 Written by: R. Harris |
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